Although we don’t believe in timing the market or panicking over daily movements, we do like to keep an eye on market changes — just in case they’re material to our investing thesis.
The Dow Jones Industrial Average (Dow Jones Indices:.DJI) is trying to end its four-session losing streak and has bounced back a bit today, up 34 points, or 0.22%, as of 2:45 p.m. EDT. Last week’s pullback of 2.2% also revealed some weakness in retail stocks. Last Wednesday Macy’s second-quarter results missed estimates on earnings per share and revenue. The next day Wal-Mart also missed estimates on EPS and sales, and both companies lowered their earnings guidance for the year. Fortunately for investors looking to start this week off on the right foot, Best Buy Co., Inc. (NYSE:BBY) and The Home Depot, Inc. (NYSE:HD) stepped up to the plate.
In fact, The Home Depot, Inc. (NYSE:HD) pretty much hit a home run. The company reported a 17.2% increase in net earnings to $1.24 per share, easily beating estimates. Its comparable-store sales in the U.S. surged 11.4%, helping to post a sales gain of 9.5%. To top it all off, The Home Depot, Inc. (NYSE:HD) then raised guidance for the rest of the year.
The Home Depot, Inc. (NYSE:HD) looks poised to continue recording impressive sales as the housing market rebounds. The company finds itself in a sweet timing spot, as most do-it-yourself home improvement takes place when homes surpass 25 years in age — and nearly 70% of the market has now surpassed that. Yet the earnings beat and improving outlook failed to impress investors today, and The Home Depot, Inc. (NYSE:HD) is one of only a handful of Dow Jones Industrial Average (Dow Jones Indices:.DJI) components trading in the red today, down 0.6%.
Best Buy Co., Inc. (NYSE:BBY)’s stock price has soared this year, up more than 170% year to date. It’s hoping to keep that momentum going today, announcing its first profitable quarter in a year and crushing earnings estimates. Excluding items, Best Buy Co., Inc. (NYSE:BBY)’s EPS came in at $0.32, far ahead of the estimated $0.12 per share. Revenue of $9.3 billion beat estimates still declined from last year. Investors have cheered the news, bidding the stock up 12% today.